Industry Players Praise FCC's Pulling Set-Top Item

FCC chairman Tom Wheeler's pulling of his own set-top rules revamping proposal from a public meeting vote today (Sept. 29) continues to draw strong reactions, including one of praise and relief from providers in the the multichannel video industry.

Wheeler said the item just ran out of time, with a new iteration circulated late Wednesday with changes that still needed discussion. It remains on circulation and could be voted at any time. But its delay was a victory for critics, since remaining on the agenda for the Thursday's meeting would have meant it almost certainly would have the three votes needed for passage.

Critics of the item were understandably pleased.

Comcast senior executive vice president David Cohen said pulling the item was the right decision, adding: "It is now critical that the Commission heed the bipartisan calls of dozens of Members of Congress and respected third parties and release its new proposal and associated rules to allow the public to provide comment." (Commissioner Ajit Pai, meeting the press after the meeting, seconded that call for more review and comment.)

Cohen said: "This is an extremely complicated and technical item that should not be adopted without the opportunity for expert and public input. Based on the limited information available from the Chairman’s Fact Sheet and op-ed, a broad range of content creators, civil rights organizations, labor unions, and others have concluded that the Chairman’s new approach does not solve the copyright, privacy, innovation and other significant concerns that were implicated in his discredited original proposal – and suffers from the same legal infirmities."

Programmers this week made it clear that if the FCC remains involved in decisions of an app licensing body, either on the front end via determining standards, or reviewing them -- or on the back end through a complaint mechanism -- they are not going to support it.

"We share the goal of providing consumers more options to access their video services without the need for a set-top box as we are proving through our Xfinity TV Partner Program," Cohen said, "[b]ut heavy-handed government regulation, based on questionable legal authority in a fast-moving marketplace will stop the apps revolution dead in its tracks, and delay consumer choice.”

“The MPAA is pleased that the FCC is taking more time, and we hope they use it to ensure any set-top box proposal remains consistent with copyright policy and avoids harming creators,” said Motion Picture Association of America chairman Chris Dodd. “As the MPAA and its member companies have repeatedly stated over the last year, we support the FCC’s goal of promoting set-top box competition, but we continue to urge the Commission to forge a path that does not undermine the creative economy. Copyright employs more than 5.5 million U.S. workers and generates over $1 trillion in economic value – incentivizing innovation and investment in creative works enjoyed by millions around the world.”

Bob Quinn, AT&T Senior VP of federal regulatory, was also pleased with the delay. “In light of the limited information that has been publicly disclosed, AT&T supports the call for additional review and public comment on the FCC’s modified set-top box proposal," he said in a statement. "We have always said that this complicated technology mandate is unnecessary given the rapidly expanding applications-based marketplace. No FCC proceeding in recent years has drawn more unified opposition and bipartisan expressions of concern." That point has been made from Capitol Hill as well.

"Important questions remain about the scope of the FCC’s authority as well as the complex framework proposed in this item, and about the significant impact it could have on existing statutory privacy, copyright and licensing protections. These concerns all suggest that this proposal needs to be brought from the back rooms of the FCC into the sunlight to ensure that consumers continue to receive the innovative video products the marketplace has already been delivering," Quinn said.

Applause also came from USTelecom President Walter McCormick. “We’re pleased the commission is taking more time to fully consider the complex technical and legal issues in this proceeding," he said. "The course of action the commission was considering received widespread concern from both sides of Capitol Hill and the creative, content and television industries. We hope the commission will provide a meaningful opportunity for all involved to provide input on any new proposals.”

"I welcome the decision by the Democrat majority of the FCC to pull the item from today's agenda that would have imposed a new regulatory mandate for video navigation devices and apps," said Free State Foundation President Randolph May. "To the extent that commissioner Jessica Rosenworcel's continued concerns about the wisdom of Chairman Tom Wheeler's proposed approach were responsible for deferring the vote, I commend her for this."

The Association of National Advertisers, whose members represent billions of ad dollars, praised the delay.

"The Association of National Advertisers is pleased to see that the FCC is not rushing to judgment on the set-top box issue. As has been advocated by ANA and other industry stakeholders, including members of Congress, we hope that this means that the Commission will publish its proposal with the details before it moves forward, so that interested parties can carefully review the specific elements. We agree with the Commission that this issue merits further consideration and hope this development will allow for more public awareness of their approach and a more useful public comment process. This is a far-reaching proposal with very serious implications."

"Like the FCC, ANA is enthusiastic about the next generation of multichannel television where content will be device-agnostic. However, as we clear the way forward for the next generation of broadcast and cable, the FCC must carefully consider the contract, privacy and copyright challenges that lie ahead. Any proposal impacting the transfer of advertising content must ensure the protection of copyright agreements, especially because of the essential nature of advertising as a funding source for the exponential growth of programming in recent years. We look forward to working with the FCC on these issues on behalf of consumers and advertisers, and together to usher in the next generation of multichannel television innovation.”

Rosenworcel's vote was key, and she has had issues with the FCC's involvement with the app licensing process, contracts and copyrights.

Opponents of the delay were looking to win another day.

"We are disappointed by today's delay," said Joshua Stager of the Open Technology Institute. "Congress directed the FCC to end the set-top box monopoly in 1996, and consumers have been waiting ever since. We recognize the desire to get these reforms right, but consumers can't afford to wait another two decades. The FCC must move swiftly and Congress should not stand in its way.”

The National Hispanic Media Coalition, which backs the Wheeler proposal, was not happy.

“While the Commission has promptly followed all Congressionally-designed protocols articulated in the Administrative Procedure Act and may issue its vote at any time, we are dismayed by yet another delay that many in our community cannot afford. A vote to unlock the box is one that will provide relief to millions of families who have paid these unnecessary fees for far too long already.”